EUR/USD dropped today as the reports showed that the US economy improved. The growth of GDP and the improvement of the confidence in the jobs market supported the dollar. On the other hand, the hawkish stance of the European Central Bank may boost the euro. EUR/USD trades currently near 1.3746.
US GDP increased at an annual rate of 2.8% in the fourth quarter of 2010, according to the “second” (preliminary) estimate, while forecasts suggested a 3.3% growth. In the advance estimate, the increase of GDP was 3.2%. In the third quarter, GDP increased 2.6%. (Event A on the chart.)
Michigan Sentiment Index in its revised estimate rose to 77.5 in February from the January reading of 74.2 and the preliminary estimate of 75.1. The median forecast was 75.5. The index rose to its highest level in three years as economy and jobs improved. (Event B on the chart.)
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